Harvard Pilgrim Health Care is requesting an average premium increase of nearly 40 percent for its individual plans on Maine’s Affordable Care Act marketplace in 2018.
The requested annual increase of 39.7 percent is by far the largest ever sought by any of Maine’s three remaining ACA marketplace insurance providers. A year ago, the largest increase was 25.5 percent, a hike requested – and received – by Community Health Options.
In the past, federal subsidies based on income have largely offset increases in out-of-pocket costs for low- to moderate-income policyholders, but Republican efforts to replace the ACA have created uncertainty about the future of those subsidies.
Harvard Pilgrim cited higher costs and market instability as reasons for the magnitude of its requested increase, and suggested that it might have to exit the marketplace altogether unless Congress acts.
“While we remain committed to the principle of everyone having access to affordable coverage, we can only continue to participate in the exchanges if there is stability in this market, and that will only come with immediate action from Washington,” company spokeswoman Joan Fallon said in a written statement.
The state Bureau of Insurance set a deadline of 4 p.m. Friday for Maine’s three ACA marketplace insurers to submit their rate increase requests for 2018. While the bureau said it did not plan to publish the documents until next week, Harvard Pilgrim and Anthem Blue Cross and Blue Shield agreed to share the amount of their requests with the Portland Press Herald on Friday.
Anthem said it is requesting an average premium increase of 21.2 percent in Maine for individual ACA plans, citing higher costs and heavier usage by members. It also expressed concerns about market instability and said its rates and services could be subject to further changes.
Both Harvard Pilgrim and Anthem said their rate increase requests assume that the cost-sharing reduction subsidies will continue to be funded in 2018.
However, the House Republicans’ ACA replacement bill, known as the American Health Care Act, would eliminate income-based subsidies in favor of tax credits based on age. Health experts have said the change would significantly reduce affordability for older policyholders.
86,000 MAINERS HAVE ACA PLANS
“Without certainty of funding before final decisions need to be made for 2018, Anthem Blue Cross and Blue Shield will need to evaluate appropriate adjustments to our filings such as reducing service area participation, requesting additional rate increases, eliminating certain product offerings or exiting the individual ACA-compliant market in Maine altogether,” Anthem spokesman Colin Manning said in a written statement.
Community Health Options, Maine’s largest ACA insurance provider, did not respond to requests Friday for its proposed rate increase for 2018.
Together, Harvard Pilgrim and Anthem insure about 32 percent of the 86,000 Mainers with ACA-compliant health insurance. In Maine, Harvard Pilgrim has about 10,500 ACA members, Anthem has about 16,750 and CHO has 58,750. Aetna had been an ACA insurer in Maine but dropped out as of 2017.
Sen. Angus King, an independent, sent letters to Maine’s three ACA insurers on May 26 asking if uncertainty about the law’s future will end up raising the cost of insurance. King asked the insurers to submit a hypothetical rate comparison that accounts for price increases resulting directly from partisan efforts to undermine the ACA.
“These rate increases appear to confirm Sen. King’s concerns that decisions by the administration and Congress are undermining the Affordable Care Act, creating significant instability in the individual health care market, and affecting premiums,” King spokesman Scott Ogden said in a written statement. “Sen. King is interested in knowing what percentage of these increases are the result of these misguided efforts, which is why he has sent a letter to Maine’s insurers asking them to provide rate comparisons and he looks forward to receiving that information. In the meantime, he continues to urge his colleagues to abandon efforts to repeal the Affordable Care Act, and, instead, come together to make meaningful improvements to the law – and do so immediately.”
Representatives of Harvard Pilgrim, Anthem and CHO all said this week that they had received King’s inquiry and planned to respond.
A spokeswoman for Sen. Susan Collins, a Republican, said another ACA replacement Bill that Collins introduced in January with Sen. Bill Cassidy. R-Louisiana, would do a better job of stabilizing the market than either the current law or the House’s AHCA. The bill would allow states to maintain what they have or choose other options to provide health insurance to their residents.
“As evidenced by these requests for massive, double-digit rate increases, the individual market is under considerable stress and in danger of collapsing if Congress does not act,” Collins spokeswoman Annie Clark said in a written statement. “The unsustainable trajectory of skyrocketing premiums under current law has reduced the affordability and accessibility of health care for thousands of Mainers across our state.”
PREMIUMS UP SHARPLY SINCE 2013
According to a study released in May by the U.S. Department of Health and Human Services, average monthly premiums for individual plans on the ACA marketplace in Maine have increased by 55 percent since 2013, the ACA’s first year of implementation. During that time, the average monthly premium has increased from $335 to $518, it said.
Average out-of-pocket costs for ACA insurance premiums are much lower and have increased by far less because of the subsidies. According to a report issued in April by the Kaiser Family Foundation, a nonprofit organization focusing on national health issues, out-of-pocket costs for ACA insurance have remained between 5 percent and 10 percent of annual income in Maine and across the United States.
The rate increases requested by Maine’s three ACA-compliant insurance providers are preliminary and are subject to approval by the Bureau of Insurance.
The bureau, which regulates rate requests by insurance companies, approved 2017 rate increases of 25.5 percent for CHO, 21.1 percent for Harvard Pilgrim and 18 percent for Anthem. Most of policyholders’ out-of-pocket costs associated with those increases are being offset by government subsidies.
About 90 percent of Mainers who have individual plans under the ACA qualify for subsidies because they earn between 100 percent and 400 percent of the federal poverty limit. In Maine, the 400 percent threshold is $97,000 for a family of four.
J. Craig Anderson can be contacted at 791-6390 or at:
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